Paris is the first city in France to implement some form of residential rent control. The first came in 2014 (enacted in the market in 2015), but this was later removed in 2017. The second came in 2019, and this current program remains in place until November 2026, at which time it will be reviewed.
But given that it has already been in place for a number of years, people have started to analyze it's effectiveness. Here is a study by Atelier Parisien d'Urbanisme (APUR) that was published this month.
The report is in French, but I can tell you that, what they did, was compare the Paris region to 8 other cities in France -- all of which do not have the same rent controls. They were: Aix-en-Provence, Grenoble, Marseille, Nantes, Nice, Strasbourg, Toulon, et Toulouse. These were allegedly chosen because their housing markets are thought to be similar to that of Paris'.
What they found was that from July 2019 to July 2023, legislated controls in Paris lowered rents by approximately 4.2%, compared to where they would have been without any market intervention.
At the same time, they noticed that these same controls seemed to become more effective over time. From July 2019 to June 2020, they lowered rents by 2.5%, but from July 2022 to June 2023, they lowered rents by 5.9%.
Paris is the first city in France to implement some form of residential rent control. The first came in 2014 (enacted in the market in 2015), but this was later removed in 2017. The second came in 2019, and this current program remains in place until November 2026, at which time it will be reviewed.
But given that it has already been in place for a number of years, people have started to analyze it's effectiveness. Here is a study by Atelier Parisien d'Urbanisme (APUR) that was published this month.
The report is in French, but I can tell you that, what they did, was compare the Paris region to 8 other cities in France -- all of which do not have the same rent controls. They were: Aix-en-Provence, Grenoble, Marseille, Nantes, Nice, Strasbourg, Toulon, et Toulouse. These were allegedly chosen because their housing markets are thought to be similar to that of Paris'.
What they found was that from July 2019 to July 2023, legislated controls in Paris lowered rents by approximately 4.2%, compared to where they would have been without any market intervention.
At the same time, they noticed that these same controls seemed to become more effective over time. From July 2019 to June 2020, they lowered rents by 2.5%, but from July 2022 to June 2023, they lowered rents by 5.9%.
Le Corbusier's Cité Radieuse in Marseille is, as I have mentioned before, one of the most important and influential multi-family buildings of the 20th century. As an architecture student, this is one of those buildings that you get indoctrinated with, so I was excited to visit it for the first time with Neat B in 2022 on what was our second visit to Marseille. We're big fans of the city. Here is the post I wrote following that visit.
Today, let's look at one of the actual suites, which is currently listed for sale through Architecture de Collection. But first, a reminder: The complex was originally constructed between 1948-1952 and was meant to serve as a new housing model for post-war France. In 2016, the building was designated a UNESCO World Heritage Site and, today, you'll sometimes find things like a Chanel fashion show taking place on its rooftop.
The suite that is for sale is Type E, which is about 100 m2. It has 3 bedrooms and 2 bathrooms. A balcony. And a view of the Mediterranean. It is listed for 650 000 €, which works out 6,500 € per square meter. For Toronto readers, this is right now the equivalent of C$965,485 or about C$897 per square foot. The monthly copropriété charge is about 300 € and the annual property taxes are about 2000 €.
The train from Paris to Marseille takes just over 3 hours:
To drive this same distance, it would take just over 8 hours:
So unless you had a very specific reason, I don't know why you'd ever want to drive this route. I certainly hate long drives and would avoid this at all costs.
On a related note, the Canadian government announced this week that it will actually be moving forward with a high-speed train linking Québec City to Toronto, stopping in Peterborough, Ottawa, Montréal, Trois-Rivières, and Laval. And unlike previous announcements, it will actually go pretty fast -- upwards of 300 km/h, which is comparable to what the TGV does on the above route.
There are three consortia currently competing for this contract, but apparently the federal government has already chosen a winning bidder. An announcement is expected next month. At the same time, the project office owns all of the bids, and so there's a chance that elements from each of them could be used in the final project.
According to official messaging, the design alone is expected to take some 4 to 5 years, which is an eternity and way too long. But at least we seem to be moving forward. This rail link is a no brainer. It will compress the geography of an importantly bilingual corridor with nearly 20 million people -- about half the population of Canada! It's our megalopolis.
Now we just need to move forward with urgency and with an unwavering commitment to creating the best high-speed rail service in the world. Let's not accept mediocrity. And let's not cancel it once we've already sunk millions into it. That would be a terrible outcome for such an obviously important nation-building project.
LFG.
Finally, they also found that the controls seemed to impact smaller places the most. For apartments between 8 and 18 m2, rents were 10.2% lower than expected during July 2019 and July 2023.
This is all interesting stuff, but in many ways, it is expected. Rent controls are intended to depress rental growth. That's the whole point. And based on this data from APUR, it is working in Paris.
But the really tough questions pertain to the possible knock-on effects. If rents are 4.2% lower, but operating costs are now growing faster than rents, then this is a problem for the housing market. You're on an unsustainable path.
And if lower rents mean that fewer developers are going to build new housing, then this is also a problem, because less supply will eventually translate into more upward pressure on rents. I don't know for sure that this is happening in Paris, right now, but these are crucial considerations.
It's never as simple as just looking at rents and thinking lower is better for long-term affordability.
Le Corbusier's Cité Radieuse in Marseille is, as I have mentioned before, one of the most important and influential multi-family buildings of the 20th century. As an architecture student, this is one of those buildings that you get indoctrinated with, so I was excited to visit it for the first time with Neat B in 2022 on what was our second visit to Marseille. We're big fans of the city. Here is the post I wrote following that visit.
Today, let's look at one of the actual suites, which is currently listed for sale through Architecture de Collection. But first, a reminder: The complex was originally constructed between 1948-1952 and was meant to serve as a new housing model for post-war France. In 2016, the building was designated a UNESCO World Heritage Site and, today, you'll sometimes find things like a Chanel fashion show taking place on its rooftop.
The suite that is for sale is Type E, which is about 100 m2. It has 3 bedrooms and 2 bathrooms. A balcony. And a view of the Mediterranean. It is listed for 650 000 €, which works out 6,500 € per square meter. For Toronto readers, this is right now the equivalent of C$965,485 or about C$897 per square foot. The monthly copropriété charge is about 300 € and the annual property taxes are about 2000 €.
The train from Paris to Marseille takes just over 3 hours:
To drive this same distance, it would take just over 8 hours:
So unless you had a very specific reason, I don't know why you'd ever want to drive this route. I certainly hate long drives and would avoid this at all costs.
On a related note, the Canadian government announced this week that it will actually be moving forward with a high-speed train linking Québec City to Toronto, stopping in Peterborough, Ottawa, Montréal, Trois-Rivières, and Laval. And unlike previous announcements, it will actually go pretty fast -- upwards of 300 km/h, which is comparable to what the TGV does on the above route.
There are three consortia currently competing for this contract, but apparently the federal government has already chosen a winning bidder. An announcement is expected next month. At the same time, the project office owns all of the bids, and so there's a chance that elements from each of them could be used in the final project.
According to official messaging, the design alone is expected to take some 4 to 5 years, which is an eternity and way too long. But at least we seem to be moving forward. This rail link is a no brainer. It will compress the geography of an importantly bilingual corridor with nearly 20 million people -- about half the population of Canada! It's our megalopolis.
Now we just need to move forward with urgency and with an unwavering commitment to creating the best high-speed rail service in the world. Let's not accept mediocrity. And let's not cancel it once we've already sunk millions into it. That would be a terrible outcome for such an obviously important nation-building project.
LFG.
Finally, they also found that the controls seemed to impact smaller places the most. For apartments between 8 and 18 m2, rents were 10.2% lower than expected during July 2019 and July 2023.
This is all interesting stuff, but in many ways, it is expected. Rent controls are intended to depress rental growth. That's the whole point. And based on this data from APUR, it is working in Paris.
But the really tough questions pertain to the possible knock-on effects. If rents are 4.2% lower, but operating costs are now growing faster than rents, then this is a problem for the housing market. You're on an unsustainable path.
And if lower rents mean that fewer developers are going to build new housing, then this is also a problem, because less supply will eventually translate into more upward pressure on rents. I don't know for sure that this is happening in Paris, right now, but these are crucial considerations.
It's never as simple as just looking at rents and thinking lower is better for long-term affordability.
